Separate from the Troubled Assets Relief Program, the Housing Finance Agency wants Freddie Mac and Fannie Mae to start buying $40 billion a month of tanking mortgage securities. That was after the two agencies told bond traders last month they would start upping their buys to $20 bil a month.
This seems like a good news, bad news story.
On the bad side, when Fannie and Freddie were taken into conservatorship Sept. 7, they were limited in how much they could grow their portfolio. And now, they’re being told to balloon it. So, it seems like Paulson et al are throwing in everything but the kitchen sink.
On the good side, they’re throwing in everything but the kitchen sink.
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